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The Council of Ministers has decided to proceed with cutbacks on
operational expenses of the public sector, reaching 150 million euro.

The Cabinet convened during an extraordinary meeting under President of
the Republic of Cyprus Demetris Christofias and discussed about the
reduction of operational expenses in addition to the reduction foreseen
in the state budget of 2010, on the basis of a plan, prepared by the
Ministry of Finance.

Government Spokesman Stephanos Stephanou told reporters after the
meeting that until the end of 2011, 150 million euro will be saved.

We decided further reductions of operational expenses of 150 million
euro until 2011. For 2010 we decided to cut operational expenses by 60
million euro, and by 90 million euro in 2011. So, in total, 150 million
euro in two years, he said.

The decision falls within the framework of the governments policy to
reduce the cost of the public sector, he said.

Stephanou noted that all Ministries will do cutbacks and explained that
reduction of costs does not include development projects.

Government Spokesman Stephanos Stephanou said that the government is
making all necessary steps to deal with any moves to bring back the
issue regarding the direct trade with the Turkish occupied areas of the
Republic of Cyprus.

Replying to questions after the meeting of the Cabinet of Ministers,
Stephanou said that the government is very active and makes steps on
the basis of arguments to deal with any intentions to bring back to the
surface the issue of direct trade.

Our position on the matter is very well known, he went on to say.

He also said that during its next meeting, the National Council, the
top advisory body to the President on the handling to the Cyprus
problem, will discuss about the course of the UN led Cyprus talks.

He added that the National Council, that will convene on April 7, will
also discuss about the forthcoming visit of Greek Premier George
Papandreou to the island.

The US State Department has expressed its support towards the leaders
of the two communities in Cyprus for their courageous efforts to find a
solution in Cyprus.

Invited to comment on the joint statement issued by the leaders of the
two communities in Cyprus, Cypriot President Demetris Christofias and
Turkish Cypriot leader Mehmet Ali Talat, a State Department official
said that as the leaders take a break in the negotiations, we want to
take this opportunity to reiterate our support for their courageous
efforts to find a solution.

We were encouraged to hear this week that the leaders have made
important progress on EU matters and the economy, in addition to their
earlier convergences in governance and power-sharing. The two leaders
have shown great courage in pursuing these negotiations, and what they
have achieved is significant, he added.

The State Department official noted that President Obama has made clear
our support for a just and lasting settlement that reunifies the island
into a bi-zonal and bi-communal federation.

We support the leaders of both Cypriot communities in their ongoing
efforts to reach a settlement under the auspices of the United Nations
Secretary-Generals Good Offices Mission under Alexander Downer, he went
on to add.